5:01pm:Shares inched higher over the past month as investors ignored the adage “sell in May and go away” and optimism about the energy sector offset gloom in the iron ore sector.

The S&P/ASX 200 Index eked out the smallest of gains for the month, rising 0.06 per cent to 5492.5 points, to post the first gain in May in five years. After two consecutive months of gains shares are now ahead 2.3 per cent year-to-date.

Today, the benchmark index fell 30 points, or 0.5 per cent, as mining stocks extended their slide and Commonwealth Bank of Australia fell shy of Thursday’s record high.

As May drew to a close, the S&P 500 was trading at a record high having advanced 1.9 per cent, while most other major developed markets also pushed ahead over the month.

“Equity markets were broadly stronger across all sectors and geographies in May as investors’ attention shifted from a mixed US earnings season to increased global merger and acquisition activity,” Bell Asset Management chief investment officer Ned Bell said.

On the local bourse, Commonwealth Bank led the market’s gains, lifting 3.8 per cent over the month to $81.59. But the rest of the big four banks, which report on a different calendar to CBA, all declined after trading without the rights to bumper interim dividends.

Westpac Banking Corporation lost 0.8 per cent to $34.42, ANZ Banking Group shed 1.7 per cent at $33.49, and National Australia Bank fell 3.5 per cent to $33.49.

4:41pm: From today's best and worst below, the obvious standout is Lynas, down 17.6 per cent today after jumping around 50 per cent in recent days. Why the big moves? Here's IG's Evan Lucas:

“The rally came as the company finally looked to be shoring up its balance sheet, however the share purchase plan (SPP) has got away at a reasonable discount to the last trading price. At an issue price of $0.113 a share, the market is just reacting to the SPP level and pulling back closer to the SPP price."

4:25pm: The local economics team at Goldman Sachs have restated their minority view that the next rate move will be down, not up.

But despite the strong rhetoric, in a new note to clients they push the timing for a 25 basis point cut to September from July.

First, they detect a more “dovish tone” from the RBA since the central bank adopted a neutral policy stance in February. The change in tone, say the Vampire Squid’s economists, was in response to:

“Sharply” lower commodity prices;

Global growth which “faltered somewhat” in early 2014;

“Relatively benignly” inflation; and

Business and consumer surveys moving lower.

Secondly, while March quarter GDP growth should be “robust”, they see a “deterioration” in their propriety leading indicators.

“Our current activity index suggests growth momentum has slowed materially in 2Q14, financial conditions have tightened and an audible snapping in consumer sentiment post the Budget has taken sentiment to levels not seen since prior to the current rate easing cycle,” they write.

Despite all that, they delay their rate cut call by two months, but don’t think for a second they are changing tack:

“Indeed, an assessment of forces that shift the RBA policy bias in the past has reinforced our belief that further monetary accommodation is required.”

4:07pm:Seven Group Holdings chief operating officer Ryan Stokes, the son of Australian billionaire Kerry Stokes, says he and his father would "love" to do business deals with James Packer in Chinaand elsewhere.

Speaking at an Australia and China conference in Melbourne, Mr Stokes responded to comments by theCrown Resorts chairman that he was interested in working with the Seven Group Holdings executive chairman.

The two are close friends and recently travelled to China together as part of Tony Abbott's business delegation, which Ryan Stokes also took part in.

"He has an incredibly eye to pick investments, he was done exceptionally well," said Mr Stokes.

"To be able to do that, we would be excited about it. And it's also good fun. He and Kerry have a very close relationship. That opportunity we would love."

Mr Stokes did not specify whether the media sector represented the chance for a partnership with Mr Packer, who said at the conference he was keen to expand his film production business Ratpac to China.

Seven Group Holdings operates the Seven television network in Australia, while the Stokes family hasprivate media interests in China, including content distribution, production and publishing ventures.

However Mr Stokes said he was keen on looking at a "diverse set" of opportunities for investments with Mr Packer:

3:49pm:China's growing list of problems, including a slowing economy, rising militarism, messy corruption crackdown and increasingly troubled shadow banking sector, could provoke a major financial crisis. In the "never waste a crisis" spirit, a number of investment opportunities present themselves:

Short Chinese stocks. Investors who lack direct access to mainland Chinese stocks can use Hong Kong-listed equities and exchange-traded funds.

Sell commodities. A financial crisis in China would no doubt further depress commodity consumption and prices.

Sell commodity currencies. The currencies of weak emerging economies that depend on commodity exports for growth will suffer. Developed countries' currencies, such as the Australian and Canadian dollars, are also vulnerable.

Avoid major country equities. Financial difficulties and recession in China, the world’s second-largest economy, would probably spread globally.

Buy the US dollar and Treasury bonds. These are the consistent havens in times of global uncertainty.

Short the Hong Kong dollar.

Perhaps all of this is fanciful. China could successfully increase economic growth, transition smoothly to a domestic-driven economy, control its rising militarism, reduce corruption without major disruptions, cease manipulating the yuan, lower the risks in shadow banks without clumsy bailouts, slowly let the air out of the real-estate bubble and deregulate interest rates.

Given the history of other countries with similar problems, I wouldn’t bet on it.

3:38pm:Origin Energy and Santos are competing against the Chinese state-owned giant, PetroChina, for a $300 million plus stake in the Poseidon gas discovery off the coast of Western Australia, reports the AFR’s Street Talk column.

An announcement on a deal is expected within the next few days.

According to sources, Origin Energy and Santos are battling hard for the bulk of Karoon Gas Australia’s 40 per cent stake in the field as both seek to expand their gas reserves.

Woodside and Shell have also been mentioned as potential contenders, although sources played down their appetite, given the number of large-scale projects in which they are involved such as the $27 billion Browse gas fields.

Poseidon sits to the north-east of Browse and was discovered in 2009 by Karoon and US heavyweight, ConocoPhillips.

As Street Talk revealed this week, PetroChina may extend its grip on the hydrocarbon reserve if it opts to buy the Karoon holding.

The listed arm of China Natural Petroleum Corp already controls a 20 per cent stake in Poseidon, which it snapped up in 2013 from ConocoPhillips, and holds a slice of the Woodside-led Browse project.

Purchasing an additional portion from cash-strapped Karoon would take its control of Poseidon to over 50 per cent. Any deal would be subject to FIRB approval and joint venture partner, ConocoPhilips, would have to waive its pre-emptive rights.

2:53pm:The Shanghai Futures Exchange is planning to launch China's first nickel and tin futures this year, local media is reporting, as part of steps to internationalise the country's commodity markets.

Ye Chunhe, ShFE vice general manager, also confirmed to a conference in Shanghai on Thursday that the bourse expects to launch a futures contract on a base metals index, the Securities Times reported.

The paper added, without citing sources, that the exchange had also designed options contracts for copper and gold.

2:48pm:Foreign investors may be helping to push up the prices of some Australian homes, but are probably not crowding out first home buyers, the Reserve Bank says.

Amid anecdotal claims some local buyers are being priced out of the market by cashed-up overseas investors, a new submission from the central bank examines official data on the topic.

It says foreign investment in residential housing was at most 5 to 10 per cent of market turnover, and last year the government approved $17 billion in property investment from overseas, with most of the money funding the purchase and construction of new homes.

As foreign investors' share of the market has remained fairly steady over the past two decades, the Reserve concluded overseas buyers were not the main reason for price rises over the period.

However, it conceded extra investment from foreigners could contribute to price rises because there were ''rigidities'' in the supply of housing that meant there were not enough new homes being built to meet demand.

''Given this sluggishness, part of any increase in foreign housing demand may spill over into higher dwelling prices, though the data suggest that this has not been into the parts of the market where Australia's first home buyers are typically concentrated,'' the RBA said.

2:33pm: The corporate watchdog could cease to become a "proactive" regulator under Abbott government cuts to funding.

Greg Medcraft, chairman of ASIC, said his organisation would be forced to rely more heavily on whistleblowers, saying the cuts, outlined in the federal budget, would limit its ability to watch over corporations.

"What it means is that we don't have the luxury of doing as much proactive surveillance," he said.

"On reactive surveillance – where someone comes to us and says, 'we've seen a problem' – that is something we will continue to take action on.

"That doesn't mean we will pursue everything, because clearly, with less resources, we need to be more careful and smarter and even better at selecting the right matters to pursue."

Mr Medcraft said it was up to government to determine how strongly it wanted the market to be monitored.

"You can have an ASIC at $200 million, $300 million, $400 million. It's up to government to determine what level of resilience they want in financial systems. And we will do our best with that money," he said.

"That intelligence that we get from complainants, like whistleblowers becomes more important."

Mr Medcraft also defended his organisation against claims it failed to monitor the Commonwealth Bank financial planner scandal.

2:04pm: The controversial former boss of Leighton Holdings, Wal King, has consolidated his recent flirtations with the iron ore sector by joining the board of Sundance Resources.

King will become non-executive deputy chairman of the company, which is trying to develop its Mbalam iron ore project on the border of Cameroon and the Republic of Congo.

King served 23 years as chief executive of the construction company until 2010, and has since attracted controversy over his handling of corruption allegations during his time at Leightons.

He is now a non-executive director of Coca Cola Amatil, and is non-executive deputy chairman of Ausdrill, and his first direct involvement with iron ore came in August 2013, when he was hired as a special advisor to Citic Pacific’s Sino Iron project.

His experience in construction and big projects will match Sundance’s ambitions, and the deputy chairman role flags him a potential successor to long-serving chairman George Jones.

1:50pm: The latest private sector credit or lending data (+0.5% in April, for annual growth of 4.5%) is encouraging, particularly given that the lift in credit continues to be relatively broad-based, CommSec economist Savanth Sebastian notes:

It wasn’t surprising that housing credit continued to be the main driver but the rise in business borrowings is a huge positive – particularly in light of the recent improvements in labour market conditions and business hiring intentions.

Business conditions are healthy and it seems to be translating through to a lift in business borrowings, with annual growth coming in at 2.7 per cent – a 15-month high. At the same time, investor housing credit is growing at the fastest pace in 3½-years and will support the broader economic recovery.

But apart from taking out loans to buy investment properties, Aussie consumers remain reluctant to borrow. Personal debt is still down almost 9 per cent on the peak recorded six years ago and the level of debt effectively hasn’t budged in five years.

And the negative backlash and concerns over the federal budget is unlikely to result in a shift in the inherent level of consumer conservatism in coming months.

1:35pm: Hong Kong’s Cheung Kong Group has struck a deal to acquire gas distributor Envestra in a $2.37 billion deal, trumping the rival offer from APA Group, which many expect to give up on the battle.

The $1.32-cash-per-share bid is being recommended by the independent directors of Envestra, who had previously backed the APA bid, Envestra said.

Gas pipeline giant APA, which already owns 33 per cent of Envestra, has a reputation of going aggressively after takeovers and coming out on top.

However, Cheung Kong’s all-cash offer is regarded as full and would require a significant increase in the offer from APA, which is based primarily on scrip.

Envestra shares are up 1.3 per cent at $1.367, while APA shares are up 0.9 per cent at $6.955.

1:00pm: Looks like we haven't seen the end of the iron ore sell-off yet: Dalian futures are down another 1.9 per cent at 689 yuan, pointing to a further drop in the spot price for the bulk commodity when it's set later today.

The spot price fell 1.1 per cent to $US95.70 overnight, as demand can't keep up with the additional supply coming out of Australia and Brazil.

‘‘We think it is mainly a supply story,’’ says Goldman Sachs analyst Christian Lelong. ‘‘Demand is clearly growing at a slower pace, but supply growth is particularly strong after years of overinvestment.’’

Consequently, iron ore miners are leading the sharemarket's losses today:

12:46pm: Everybody wants to know what the next bubble is, and there's an easy way to tell: just watch where Harvard grads are going. Then short the hell out of that, The Washington Post’s Wonkblog writes:

It's called the Harvard MBA Indicator - though it applies to undergrads, too - and it's one part psychology, another part economics. The idea is simple enough: It's a bad sign when more Harvard grads go to Wall Street.

Harvard is a magnet for Organisation Kids who excel at colouring between the lines. After graduation, they want to do something prestigious, something remunerative, but mostly, as Kevin Roose points out, something that gives them new lines to colour between. That might be Silicon Valley, or it might be Teach for America - or it might be Wall Street, if, that is, the getting looks good.

And the getting looks best right before a crash. Which is when, the argument goes, the Harvard MBA Indicator hits its highest levels, like it did in 1987, in 2000-02, and in 2005-08.

See, as economist Hyman Minsky explained, financial stability is destabilising. The longer markets are calm, the more people plan on them staying that way. People take bigger risks and take on bigger debt because it doesn't seem like anything can go wrong - until it does, and all this leverage turns small losses into big ones due to forced selling from margin calls.

But this era of complacency can last a long time. And it's when Wall Street exerts its strongest gravitational pull on Harvard kids. The money keeps getting better and better, and it looks like it always will. All they have to do is follow the Excel-filled road laid out before them.

That's why the more Harvard grads that head for Wall Street, the worse a sign it is for markets. It usually means that the irrational exuberance is about to give way to rational panic.

The good news now, though, is that Harvard kids aren't flocking back to Wall Street in anywhere near the numbers that they did before the financial crisis - "only" 31 per cent of seniors will be working in finance or consulting next year; down from a high of 47 per cent in 2007.

12:39pm:South Australia’s Cooper Basin, an outback shale region that’s lured investments from energy giants such as Chevron and BG Group, is set for a flurry of mergers and acquisitions, according to oil and gas explorer New Standard Energy.

“There’s another wave of rationalisation to happen over the next six to 12 months,” Phil Thick, managing director of the Perth-based energy company, said. “Everybody is talking in the Cooper Basin.”

Shale explorers in the Cooper Basin are seeking to benefit from a forecast tripling in demand for natural gas on the east coast, driven by more than $60 billion in export projects in Queensland state.

Beach Energy, Senex Energy, and Drillsearch Energy are potential takeover targets, analysts at CBA said in a January report.

New Standard, backed by Houston-based Magnum Hunter Resources, has been talking to potential partners interested in its acreage, Thick said. Its existing partner,

Ambassador Oil & Gas received a $42 million takeover offer yesterday from Drillsearch.

The explorer has discussed bringing another company into its acreage as well as potential permit access swaps, Thick said. New Standard in December agreed to acquire 52.5 percent of the exploration license in the Cooper held by Ambassador.

“We’ve had multiple discussions with multiple players, and we will continue to,” he said.

A number of deals have already occurred in the Cooper Basin, including Drillsearch’s 2012 purchase of Acer Energy and Beach’s acquisition of Adelaide Energy.

After Drillsearch’s transactions, the Sydney-based company “is more likely to become the hunted rather than the hunter,” Nik Burns and Cameron Hardie, oil and gas analysts at UBS, wrote in a note yesterday.

New Standard also has assets in the U.S. and reached an agreement with Credit Suisse Group AG to arrange as much as $45 million in debt to fund its drilling plans in the Eagle Ford shale formation, according to a statement today.

That offer followed the Stockland acquisition of a 19.9 per cent stake in Australand in March after Singapore’s CapitaLand jettisoned its entire 39.1 per cent Australand holding. Since then, Australand has boosted its development pipeline through acquisition.

Australand has now upgraded its operating earnings outlook for the full year 2014. Its earnings per security for 2014 are now expected to increase by 20-25 per cent on 2013. That forecast compares its prior guidance of 17-20 per cent growth announced on 25 March 2014.

12:12pm:Southern Cross Media Group has blamed a 10 per cent profit downgrade on the poor ratings of its metropolitan free-to-air television affiliate Network Ten, as well as soft performance from its 2Day FM metro radio network.

Southern Cross said its underlying net profit will likely be around $80 million for fiscal year 2014, compared with previous guidance of $89 million.

Investors don't seem to worried - the stock is up 1.8 per cent to $1.12.

The company’s regional television business broadcasts mostly Ten content, which has been rating poorly since the conclusion of the Sochi Winter Olympic Games in February.

About 70 per cent of Southern Cross’ TV revenue comes from its Ten content, meaning advertising sales have been under pressure.

11:57am: The spot price of iron ore at its lowest since September 2012 and consensus forecasts are tipping it to go even lower. But one of the most senior portfolio managers at giant US funds manager Fidelity Worldwide Investments is bucking the trend and buying commodity futures for the steel-making ingredient.

Andrew Wells, one of two global co-chief investment officers overseeing $US280 billion ($302 billion) in funds under management for Fidelity Worldwide Investments is tipping a bigger than expected pick-up in US growth that will offset the slower growth in China and soften the impact on the iron ore price of increased production.

The consensus view is that Australia’s biggest export is going to come under increasing pressure from increased global supply at a time when demand growth from China is slowing down.

“We expect a stronger than forecast improvement in US GDP growth that will be very supportive for bulk commodity prices,” he said. “Increased stimulus from the Chinese government is another likely factor that could also help buoy iron ore.”

Mr Wells thinks most foreign investors are too bearish on the Chinese economy because they do not understand it. Fidelity is one of the biggest foreign investors in the mainland Chinese equity market and Mr Wells spent much of his early career living and working in Hong Kong.

He is also going against trend to buy coal and copper commodity futures, which – like iron ore – are under pressure, having lost about 21.6 per cent and 6.7 per cent respectively in the year so far amid a weaker growth outlook from China.

Fidelity prefers industrial commodities over precious metals, but the fund is not getting too carried away until global growth signals are stronger.

First, abolishing paper money would allow central banks to introduce negative interest rates without fearing that everyone would start hoarding cash. An important consideration ahead of next week’s key ECB meeting, where the bankers are expected to discuss the pros and cons of negative rates to help in the fight against threatening deflation.

Second, citing a recent case where a Mexican drug cartel was found with $200 million in cash, Rogoff argues that curbing the ability of cash to facilitate tax evasion would stymie criminal activity. This point seems a bit more flaky, considering that especially organised crime has become pretty good at laundering money. But hey, the call to ban cash may just spark a debate ...

Plenty has been written about why the economist’s Capital in the 21st Century is striking such a nerve, and a bit on how some of the numbers he uses don’t add up (Rogoff can sympathise), so we won’t go into the details of what BusinessWeek has to say about the global fervour around Piketty.

But we did like that they noted that the physical version of Capital is much more popular than the e-book, perhaps indicating just how chic it is to be seen lugging the 700-page tome around.

And we wanted to share with you the excellent cover BusinesssWeek has come up with.

There has been a mildly negative correlation or inverse relationship between government balances and stock market returns. Most of the high return years from shares were government deficit years. This includes 2011 and 2013 and the likely result in 2014 (remember all years are June years in this paper).

Deficits are generally good for shareholders and surpluses are generally bad for shareholders.

In the post-war era the median real total return from shares was 10.8% pa in the deficit years but only 2.4% pa in the surplus years, which is a very significant difference. This is shown in the chart below.

There are two main reasons for this.

The first is that deficits come about by governments spending more money (and/or taxing less), and much of the additional cash ends up in company coffers, either directly via contracting to the government, or indirectly via household spending.

The second reason is one of timing.

Deficits tend to be high in mid-late recessions (when tax revenues are down and welfare spending is up), and this is when shares generally do best, rebounding out of the middle of recessions. This was the case in 1954, 1972, 1983, 1992 and 2010 (and in the pre-war years: 1922, 1923 and 1932).

Tax revenues and welfare payments tend to lag economic activity, both on the way into recessions and in the recoveries on the way out. On the other hand, stock markets tend to lead economic activity. As a result of these leads and lags, stock markets tend to do well in government deficit years, and tend to do poorly in government surplus years.

There have been very few years when government surpluses accompanied negative returns from shares. The most obvious instance was 2008, when tax revenues from the boom were still rolling in but shares were already falling in the GFC.

This financial year will be a big deficit year and shares are heading for another good 12 months to June.

The differences in returns between surplus and deficit years have been large and significant, regardless of which side of politics was in power at the time.

11:00am:Lynas shares have led investors a merry dance over the past week, with the stock ramping up by more than 50 per cent from 11 cents last Wednesday to 17 cents at yesterday’s close, only to plunge 18 per cent this morning to 14 cents.

The catalyst for the fall was an announcement that the rare earths miner had successfully completed a share purchase plan and placement, both at 11.3c per share, raising almost $40 million to help fund its “advanced materials plant” in Malaysia, the company said in a statement.

“Following the successful capital raising, we are working constructively with financiers to restructure our debt repayment obligations to further solidify the company’s financial profile through the build-up and retention of operating cash,” Lynas Chairman Nicholas Curtis said in the announcement.

“I look forward to providing a further update on this in the near term.”

10:55am: The Australian boss of Chinese miner MMG has blasted investors for exacerbating commodity price volatility, and warned that many weaker miners could shut down as the price pressure rises.

Speaking in Melbourne at a News Corp summit, Andrew Michelmore said China's drive to close poor quality steel mills was spooking investors in the developed world who were dumping their exposure to iron ore.

"That's where I expect to see quite large volatility in commodity prices as these are exacerbated and I have to say the investment community looks at it and thinks 'this is fantastic, I can swing that up and I can swing that down further' because they rely on turnover," he said.

"I'm quite cynical about the size of these swings with a very little change in the fundamentals, but that is the market, that is what we are going to get."

The benchmark iron ore price fell again overnight to $US95.70 a tonne.

Michelmore said he expects the price to be higher over the long term, but the outlook for the near future was unclear.

As reported by The Australian Financial Review ($) on Thursday, investment bank UBS was seeking buyers for 25 million Tassal shares at $3.65 each. The shares were being sold at an 11.2 per cent discount to their last close and a 9.7 per cent discount to the five-day, volume-weighted average price.

Pacific Andes retained about a 5.5 per cent stake in the Tasmanian salmon company, which it agreed to hold on to for at least 180 days.

There would have been some nervous Tassal executives and directors as the bids rolled in, with the company no stranger to strategic stakes and takeover bids.

Pacific Equity Partners, the country’s largest private equity firm, tabled an approach in late 2010 at $1.80 a share to $1.90 a share, which looks particularly opportunistic given Thursday’s close of $4.11 and $600 million market capitalisation.

Before the private equity play was made public, Canada’s Cooke Aquaculture had been casting its eye over Tassal. The process made fund manager Allan Gray furious and the activist fund threatened to remove Allan McCallum as chairman unless he engaged with third parties about a potential acquisition.

Within weeks of the PEP approach, major shareholder Webster had sold its 19.8 per cent stake to China’s largest supplier of imported fish, Pacific Andes.

At a Goldman Sachs investor conference last week, Tassal told fund managers it was targeting a 15 per cent return on assets.

10:31am: Retail billionaire Solomon Lew could be circling to scuttle the planned takeover of upmarket department store David Jones by South Africa's Woolworth Holdings after it was revealed this morning that a company Lew is a director of had scooped up 0.65 per cent of David Jones issued capital.

David Jones said in an announcement this morning that a regular review of its share register showed SL Nominees had 3.5 million shares in the group, equating to 0.65 per cent of the department store. It said Lew is a director of SL Nominees.

David Jones is currently the subject of a $2.2 billion takeover bid from Woolworths. It is unknown when Lew purchased his shares.

9:58am:Chinese steel mills are cutting back on long-term iron ore contracts in favour of cheaper spot cargoes, confident that beaten-down prices are unlikely to rebound amid the first global ore surplus in 10 years.

The spot price for iron ore fell another 1.1 per cent overnight to a new 20-month low of $US95.70 a tonne.

Market talk is swirling that some Chinese mills have cancelled iron ore cargoes, with several traders saying up to four million tonnes have been rejected, although this could not be verified by Reuters.

Iron ore demand in China is still near record levels - April imports of 83 million tonnes were the second-highest ever - but miners such as Vale, Rio Tinto and BHP Billiton are boosting production even faster.

Shipments from dominant producers Australia and Brazil are expected to grow by 40 per cent over the four years to 2017, when annual exports will reach 1.27 billion tonnes, according to Australia's Bureau of Resources and Energy Economics.

WA miner BC Iron said some of its customers have asked for small discounts or more flexible pricing periods, but it has not seen any cancellations.

"We certainly haven't had any even whispers of that as far as our product goes," managing director Morgan Ball said.

The cargoes are usually priced based on the average iron ore price index for a particular period, such as the monthly average, so with spot prices falling, it is cheaper for buyers to purchase spot cargoes.

A senior executive at a leading Chinese steelmaker told Reuters the firm has cut the volume of iron ore it buys via long-term contracts by about 10 per cent this year, noting that some of its contracts with miners gave it an option to reduce volumes.

A second official who buys iron ore for a mid-size steel mill in northern China said the company was now relying totally on the spot market.

"We used to go with annual term supply but we have stopped doing it from this year as the market outlook remains weak," the official said.

More iron ore is hitting the market, and faster that demand is growing. Photo: Bloomberg

9:58am:Wages will inevitably fall in rich countries like Australia, the US and UK as the world moves towards economic equilibrium, according to Nobel laureate James Mirrlees.

In a speech in Sydney on Thursday night, Mirrlees said the flow of capital from rich countries to poorer countries could turn into a "flood" as capital sought out the lowest wages.

"Capital can increasingly leave the rich countries and so long as wages are higher there than in the poorer countries that seems the way it should go," he said.

He said that the shift to lower wages in developed countries would not distinguish between occupations. "I should just emphasise that this theory says all wages will fall at any particular skill level – unskilled, skilled, professionals and chief executives."

In a speech to alumni from the Macquarie Graduate School of Management, Mirrlees said that if wages did not fall in rich countries then unemployment would have to rise.

Mirrless said that one of the implications of the move to economic equilibrium is that owners of capital will get more and workers will get less.

Mirrlees won the Nobel Memorial Prize in Economics in 1996. He is best known for his work on tax policy, the economics of uncertainty and development economics.

9:40am: The revolt by Westfield Retail Trust investors marks a rare defeat for Frank Lowy, a man who has gotten his way for as long as anyone can remember. It may even pierce the atmosphere of invulnerability that has surrounded the 83-year-old Lowy, his family and the Westfield shopping centre empire.

From nothing - he arrived penniless in Australia in 1952 - Lowy has built a formidable business, a globe-spanning network of shopping centres that according to Forbes has made him the world's 307th richest person, worth $US5 billion.

Westfield's ability to extract the last possible cent in rent from every square inch of its 87 shopping centres is legendary, a source of celebration for shareholders and misery for its retail tenants.

That deft touch was absent during shambolic scenes at yesterday's meeting.

Lowy's proposed split would have shovelled the lower-growth Australian and New Zealand centres into Westfield Retail Trust, to be rebadged Scentre Group, while the higher-growth international business stayed with sister company Westfield Group (which would get a small name tweak to Westfield Corporation).

Investors in the trust expressed unhappiness with the deal from the moment it was announced in early December. And yet Lowy pushed on, apparently confident he would get the restructure over the line.

His campaign culminated in a take-it-or-leave-it threat yesterday morning in which he said Westfield Group would go it alone if trust investors voted against the deal. It was that statement which threw into chaos the meeting, prompting Westfield to adjourn the meeting for up to a fortnight.

9:35am: Hard on the heels of heavy job losses in the coal industry outlined during the week, Yancoal Australia has warned that coal prices will remain weak "for a considerable period of time".

"The current outlook for the global coal market remains depressed and without clear signs of improvement," the company's co-vice chairman, Mr Cunliang Lai, told shareholders at today's annual general meeting.

"We anticipate that weak coal prices will persist for a considerable period of time."

Yesterday, Wollongong Coal announced the cutting of 152 jobs, or nearly 40 per cent of its mining workforce, with New Hope Corp cutting 5 per cent of its workforce following are view, with the prospect that more cuts will be implemented.

The downturn in thermal coal prices is expected to continue for some years, the company said, although for coking coal, which is primarily used in steelmaking, the cyclical low may have been reached with prices "bottoming and stabilising".

The company also warned it is "debt and cashflow constrained", and that it has borrowed a further $US300 million from its parent company, Yanzhou Coal, to fund ongoing capital spending commitments.

In its second estimate, the Bureau of Economic Analysis revised its estimate down from growth of 0.1 per cent to a contraction of 1 per cent. But while the initial weakness was due to bad weather, the revision was almost entirely falling inventories.

The bad weather has not continued into the second quarter, and inventories can only fall so far, so most economists expect growth to rally towards a pace closer to 3 per cent for the rest of the year.

Whereas inventory adjustments knocked 0.6 percentage points off growth in the initial release, that was revised up to 1.6 percentage points, accounting for almost all of the downward revision. Small downward revisions to net trade and government spending accounted for the rest.

Paul Ashworth at Capital Economics in Toronto said the decline was “nothing to worry about”.

“For a start, the downward revision is almost entirely because inventories were a much bigger drag on growth than previously thought,” he said. “But that bigger first-quarter drag means that we are likely to see a bigger bounce back in the second quarter.”

“Overall this report underscores the setback to the recovery from the unseasonably cold winter weather in Q1,” said Millan Mulraine at TD Securities in New York. “However, with economic momentum beginning to pick up, we are looking for a blockbuster Q2 growth performance, with GDP growth in excess of 4.0 per cent.”

9:22am: The S&P 500 index climbed to its third record closing high in four sessions overnight as traders shrugged off data that showed the economy shrank in the first quarter and bet on improvement in the second quarter.

New claims for unemployment benefits fell more than expected last week, pointing to a strengthening labour market and giving investors a reason to buy US stocks. Data from the Commerce Department showed that gross domestic product contracted for the first time in three years in the first quarter, although signs indicated it has rebounded.

"The headline figure was weaker than expected, but it was mainly due to slower inventory growth, which bodes well for future growth, future orders, new orders," said Jeffrey Saut, chief investment strategist at Raymond James Financial in St. Petersburg, Florida.

The S&P 500 gained 10.25 points or 0.54 per cent, to 1,920.03 - a record close and a lifetime intraday high.

Citi analysts said the US economy could grow nearly 4 per cent in the second quarter, while Goldman Sachs raised its estimate to 3.9 per cent.

The US 10-year Treasury note yield touched 2.40 per cent, its lowest level since last June, on expectations of further policy easing by the European Central Bank next week.

9:18am: Potential for some early movement in the share price of Reece, after the housing fixtures company felt an urgent need this morning to announce that sales over the 10 months to April 2014 were 13.5 per cent above the same period last year.

The sales boost was the result of the “improved trading performance and the integration of the Reece and Actrol businesses,” the company said in a statement.

They expect earnings before tax, the effect of currency movements, and acquisition costs to be between 3 and 5 per cent above the prior year.

9:09am: The S&P 500 has posted a third record close in four days, despite data that showed the world's biggest economy shrunk over the March quarter, opening the door to a positive start to local trading.

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"Our current activity index suggests growth momentum has slowed materially in 2Q14, financial conditions have tightened and an audible snapping in consumer sentiment post the Budget has taken sentiment to levels not seen since prior to the current rate easing cycle,”

Housing boom!

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 4:40PM

Another great week for the bulls, very contented to be Mr Ordinary making some good pocket money

I used to be a know all an now i know i knew f all

Commenter

parrot

Location

Date and time

May 30, 2014, 4:19PM

Nice plunge at the close to under 5500. What happened to 6000?

Miners dig even bigger hole.

LOL.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 4:13PM

A community service announcement from your friendly mining magnate:

http://www.youtube.com/watch?v=pMaRuk6pGOc

The biggest resources boom in history and what has changed? Answer: nothing.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 4:09PM

Ha ha ha. Mining eh. Big pile of dirt in one country. Big hole in the ground in another.

Commenter

Nobody

Location

Nowhere

Date and time

May 30, 2014, 4:41PM

FIRB Brian Wilson...“We don’t often have concerns about people of Greek or Italian extraction buying properties because they are not so easily identifiable at auctions.”

Really. Is that what we're concerned about? No. What we're concerned about is there not being enough property for Australians to buy at a fair price. What a fricken insulting red herring....Please resign.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 4:06PM

"Master Builders Australia's Brent Davies said there was a "serious gap" between the underlying demand for housing - about 180,000 units a year - and the 145,000 being built."

Nope, not if the occupancy rate ticks up which is exactly what it's doing. There is a massive floor space surplus in the housing supply. Spruiker shortage claims are bogus.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 4:04PM

What's with all the population "11 billion by 2050" comments? Mine rarely get published. Most selfish thing Australia can do is continue taking migrants. Save our land o feed SOME of the world.

"No hard landing!" said all the spruikers, spivs and real estate agents.

Even my son said so. No, I lied I don't have a son. Well technically I do, "but he's in real estate".

LOL.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 3:53PM

Just had a look at the last ten Mays: not including this year, the XAO has gone up four times. If it closes today above 5471 then that will be five out of ten and MYTH BUSTED! (Technical analysis like that is obvious garbage. Can you imagine Warren Buffet looking anxiously at the calendar and thinking: "Oooo, its May, I'd better sell..."?)

Commenter

player1

Location

Date and time

May 30, 2014, 3:49PM

plus 1, what a load of codswallop

Commenter

craig

Location

Date and time

May 30, 2014, 3:54PM

@player1, but Warren would be looking at his calendar mindful of the fact that for each of the last 3 years the AllOrds has fallen by a consistent 8% from its highest point in April to June by 30th June. Check it out for yourself.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 4:01PM

....""I'm just not gonna hire Aussies anymore," says the proprietor of a successful cafe"......Oh yeah...This is going to end well....Wages to the floor, foreign companies rub their hands together, politicians blame each other.....revolution is getting closer and closer.

Can we get some 457's running government?

Commenter

JohnBB

Location

Date and time

May 30, 2014, 3:46PM

hahaha, you are one government behind!

Commenter

craig

Location

Date and time

May 30, 2014, 3:55PM

Have you had a look at the foreign-born members of the present front-bench. PM - UK, Treasurer - Palestine, Finance Minister - Belgium. I'm sure any Australia-born bogan could do a better job. They would certainly have a better idea as to what was "fair-dinkum" and what was not.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 4:14PM

I thought my post:

US ECONOMY SHRUNK!!!!!!

Would have been the no1 post.

Unless of course:

CHINA ECONOMY HAS SHRUNK!!!!

Commenter

Dunno

Location

Date and time

May 30, 2014, 3:45PM

Punters realised MXI was too good at these prices..topped up at 0.89 but happy to avg @ 0.975c might see it again soon,decent yeild should still hold for 2014.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 3:42PM

People make the mistake of equating population growth with wealth increase.

Not so.

In the last 12 years, the population has increased by 1 billion people.

But so has the population of the mega slums around the world.

In the Philippines a diet of many slum dwellers consists of pagpag: waste chicken salvaged from bags of food waste, mostly from fast food and restaurants leftovers, recooked and sold to the residents.

11 billion people is beyond the carrying capacity of the planet.

That's why valuing resources in the ground is a fool's game.

If all the resources in ground, currently carrying a value based on actual exploitation are actually consumed that will be the end of life as we know it.

Good point @james but i dont know if ASIC is all to blame, i mean the amount of dodgy dealings/books/$$ switches going on you would just about need an "insider" in every company just to keep up, the systems seems more broke because they get away with it for sometime before the turd enters the fan....be a smart cookie who devises how to see through the financial mist some of these shifty characters hide in...i'm for regulation but i lose faith when they get off light or even continue to work in the same capacity...thats just a broken result,which may possibly lead to more punters getting shafted.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 4:03PM

What do you reckon? Will CASH go (Rogoff article)?

How do I buy produce on a weekend, say, the Daylesford market?

GG.

Commenter

Gordon Gekko

Location

Greg Coffey World

Date and time

May 30, 2014, 3:08PM

why sell in may...that's what i saymy new tune....is not sell in junewon't even apply..... to julybut this year we will go bust...in august

Commenter

cyril

Location

Date and time

May 30, 2014, 2:56PM

At least yours rhymes,unlike the good princes effort from earlier today

Commenter

Gumly

Location

Mackay

Date and time

May 30, 2014, 3:19PM

While I am still long as I don't want to realise capital gains, I'm not sure you would be much worse off if you had sold. The ASX200 is up 0.3% for May which is about what cash funds are paying.

The premiss of "sell in May...." is not that markets drop, but that markets often (but not always) stagnate. Historically, returns are positive but the likelihood of big gains is significantly less than for big losses.

Commenter

Life Is Good

Location

The Real World

Date and time

May 30, 2014, 3:35PM

ASX200 ended up 0.1% for May

Commenter

Me

Location

Date and time

May 30, 2014, 4:18PM

The collective profits of the mostly foreign owned resource companies is @ $50B/year from resources they don't own.

How many $B's are being returned each year to the indigenous owners of those resources?

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 2:53PM

Ever hear of royalties?

You know, those things mining companies pay to the owners of the minerals in the ground for digging them up.

Yeah, ABS classifies them as a property charge, because that's what they are. That's the States selling their assets (ie rocks in the ground) to miners.

Commenter

Not hard

Location

of hearing

Date and time

May 30, 2014, 3:59PM

Obviously too hard for you because a) the rocks aren't sold, only the right to dig them up is and b) royalties go to consolidated revenue to pay fat cat politician's salaries and a miniscule amount goes to the actual owners who are still living in squalid conditions right across Australia.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 4:07PM

I've never really thought of the words "proactive" and "ASIC" belonging in the same sentence, let alone the same paragraph.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:50PM

ASIC and proactive only go together if the words "is not" are between them.

Commenter

James_F

Location

Melbourne

Date and time

May 30, 2014, 3:12PM

Curious, most of my LICs are up (I have quite a few), to the point where I have sold some, but the shares in the companies they invest in are mostly down. Must have something to do with dividend/distribution dates coming up.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:42PM

650,000 Australians are out of work but Sam de Britto thinks they're just lazy. LOL what a goose.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 2:36PM

1 job for every 6 out of work, and that is only going to get worse as the Budget bites. No wonder the Libs want to make life hell for the unemployed under 30s. Those figures include 3000 trained and qualified nursing graduates while hospitals, public & private, are recruiting nurses from o/seas on 457s.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 3:32PM

And, another 800,000 on disability support. How many of those were previously on Newstart? Let's shift a few dole people onto disability, and that'll make the unemployment numbers look great! Yay, said the government, we've lowered unemployment. Toot toot! GG.

Commenter

Gordon Gekko

Location

Greg Coffey World

Date and time

May 30, 2014, 3:38PM

The stories abound about foreign workers being underpaid & overworked, paid cash-in-hand with no tax deducted, no super, no sick-leave no holidays and particularly no penalty rates. Glorified slave labour. No wonder Aussies don't want to work under those conditions.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 3:47PM

@11.30am I saw both those articles last night on ZH... Ban cash, yea bravo Rogoff, you central-planning Soviet hack. Introduce a policy that is akin to totalitarianism and gives complete control of an economy to whoever is in the halls of power. What could POSSIBLY go wrong?That's ok Ken, i'll just get out of the system, buy more gold. You keep your digital fiat garbage....

Commenter

Bye Bye Fiat Money

Location

Date and time

May 30, 2014, 2:33PM

"The Australian boss of Chinese miner MMG, Andrew Michelmore having a good whinge about the iron ore price.

Bet he wasn't complaining when China was being gouged for $160/MT.

Oh and Andrew, the long term price of iron ore is under $40. Would that suit you?

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 2:26PM

What does "long term price" mean Allan? The commodities are all tied to the USD,and if you can seriously tell me you know the value of a USD and will know it's value in say 2,3, or say 5 years, i'll agree with the "$40" price.But agreed the iron ore producers had it good, and have squandered the good times, and are not prepared for the bad...

Commenter

Bye Bye Fiat Money

Location

Date and time

May 30, 2014, 2:45PM

Seriously doubt Twiggy reads this blog or posts from the peanut gallery.

Commenter

Twiggy's PA

Location

Date and time

May 30, 2014, 3:14PM

Long term historical price:

http://i1.wp.com/montesolcapital.com/uploads/21.jpg

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 3:21PM

Anyone know why SLR are up 6% today and yet SBM are down nearly the same amount?

Have they released trading updates?

Commenter

Joe the POM

Location

Geelong

Date and time

May 30, 2014, 2:12PM

That is mostly due to the fact that SLR is a little more profitable and investors punt with a greater degree of confidence.

On the other hand SBM is a more difficult stock to predict and only for the more experienced trader, certainly not recommended for mums and dads

Commenter

craig

Location

Date and time

May 30, 2014, 2:38PM

Because there are more buyers than sellers of SLR and there are more sellers than buyers of SBM??

Commenter

Bye Bye Fiat Money

Location

Date and time

May 30, 2014, 2:40PM

i smell a hint of sarcasm there @craig, but having said that wouldn't touch either with a barge pole!

Commenter

dewf hart

Location

Date and time

May 30, 2014, 3:12PM

Greg Medcraft, chairman of the Australian Securities and Investments Commission, said his organisation would be forced to rely more heavily on whistleblowers, members of the public and industry professionals to come forward with information on big business, saying the cuts, outlined in the Federal budget, would limit its ability to watch over corporations.But Mr Metcalf you dont listen to us....how loud to you need the whistle blown before it gets your attention???Read more: http://www.smh.com.au/business/asic-needs-more-whistleblowers-after-funding-cuts-says-greg-medcraft-20140530-398la.html#ixzz33ATY09Id

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 2:00PM

the funding cuts ARE part of cutting red tape. First get rid of the unions and their little army the bikers. tick and royal commission due to start tick.cut to ribbons the funding and staff of departments that will slow things down. tick.from a business point of view it should be gold. those two kiddies "busted" for insider trading - hmmm talk about scape goats.the government knows what is coming and arent messing about. this is a proper kick start.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 2:06PM

Don't forget the schoolgirl they went after.http://www.smh.com.au/business/markets/asic-to-look-into-prank-metgasco-email-from-schoolgirl-kudra-fallaricketts-20140402-35yy7.html

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:34PM

Ive been watching tim flannery and john doyles new show - 2 men in china.last episode they visited chengdu.they interviewed someone ( I cant remember who ) and asked what was this mega city like when you were younger? he replied 4 years ago is was fields and farmers. 4 years! today its the 4th largest city in china. this is what is headed our way. http://smh.domain.com.au/real-estate-news/chinese-developer-to-transform-parramatta-20140506-37ulz.htmllet the mass consumption begin!!!!!!!

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:59PM

That would never head our way. With all the councils, state govt's over zealous regulations, nothing of scale will ever be built of significance. Who wouldn't love a Phoenix style capital city built in the middle of our desert?

Commenter

DR

Location

syd

Date and time

May 30, 2014, 2:09PM

"The spot price fell 1.1 per cent to $US95.70 overnight, as demand can't keep up with the additional supply coming out of Australia and Brazil."

Don't say you weren't warned. LOL.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:55PM

thats a lot of debt Gina. Even for someone of her immense appetite thats a big bite to take. probably why she has gone from 16 to 27 on list of powerful women. Im waiting for the inevitable news of a massive coronary on her and clive.should china be buying iron ore from stralya who has had them over a barrel ( without even buying them a drink ) or from good mates mongolia and guinea? decision decisions?

Commenter

smilingjack

Location

Date and time

May 30, 2014, 2:11PM

"demand can't keep up with the additional supply". HUH?

LOL! You stumped me there for a sec. Toot toot! GG.

Commenter

Gordon Gekko

Location

Greg Coffey World

Date and time

May 30, 2014, 2:11PM

QAN : Commsec ratings updates shows Morningstar as downgrade from hold to reduce and consensus upgrade from hold to moderate buy. I'm not the only one who is confused....

Commenter

confused

Location

Date and time

May 30, 2014, 1:55PM

Anyone got interest in TGR with the focus on food shortages is this dip a "buying opp" or somethings around the corner?

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 1:52PM

I don't see TGR having anything to do with solving food shortages, unless "let them eat cake" becomes "let them eat smoked salmon".Looked at this one several times but dividend too small. The article in the LHC points to it being a possible t/over target but what isn't these days.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:39PM

Humans first evolved about a million years ago. 70000 years ago there were 200 people who crossed out of africa.by 11000 bce there were 3 million of us.by 1 ce we had grown to 60 million.by 1800 we reached a billion and things really kicked into gear.a smidge over 200 years later we hit 7 billion.one thing is for certain barring a catastrophe of mega proportions the worlds population is going to be huge in our lifetime. I reckon 11 billion by 2050.thats a lot of food. a lot of housing. a lot of energy. a huge amount of very old people just for starters. how about jails schools traffic jams pollution and hospitals. there will be heart stopping amounts of money to be made in the coming years by picking the right industries. eat drink sleep shit are things we will all have to do.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:47PM

yes we are a virus with shoes.

Commenter

Wwwish Lion

Location

Melbourne

Date and time

May 30, 2014, 2:20PM

add breath to that list. knd of a biggy.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 2:26PM

Birth rates are slowing down in the undeveloped world. However Africa to have 4 billion by 2100. The African forests and plains will be devastated to support this. The green revolution and GE can only go so far. So who will be feeding these billions?

Commenter

Wally

Location

Flynn

Date and time

May 30, 2014, 2:26PM

the planet has a way of addressing any imbalances in population numbers...

its called a Pandemic

Commenter

fortune cookie

Location

Date and time

May 30, 2014, 2:34PM

Don't want to spoil the fun, but large parts of the industrial world already has a declining population. The rate of decline will only start to accelerate. The only parts of the world that still has rising populations are Africa and western Asia. These populations are tribal societies, most of them are not - and never will be - consumer societies.

Commenter

Dr No

Location

Sydney

Date and time

May 30, 2014, 2:35PM

Just like bacteria in a culture dish our destiny is to consume the resource which is our planet and then to die out, choking in our own waste. We like to think we're cleverer than that, but we're not.I'll stick my neck out: In 100 years the equatorial regions of the planet will be uninhabitable. All larger animals will be extinct in these regions. Most Australians will live in Tasmania.A good long term investment might be land in Tasmania, or the south island of New Zealand. Coastal and close to a healthy river, but well above sea level

Commenter

player1

Location

Date and time

May 30, 2014, 2:43PM

Climate change will solve the population problem.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:44PM

Pretty much all of Australia's population growth is from immigration. So ridiculously stupid it's impossible to comprehend we're willfully doing it.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 3:54PM

I think all of those complaining about immigration should be forced to certify that they and every member of their extended family has been Australian born for at least 5 generations. Something like the good old "racial purity laws". Otherwise are they trying to shut the gate after walking through it themselves.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 4:08PM

Comment on NXT, i think someone was becoming agitated about the falling SP, the shorters were all over it so it was a buying opportunity...today things have turned,not sure if its because of the following,but be brave and consider it growth stock,i doOn data management“Expect expodential growth in the next seven to 10 years. Winners are stocks like NEXTDC,” Tucker says.footnote: now watch it tumble :-)

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 1:43PM

I'm put off by continual notices from UBS and it's been on a steady downward trajectory. You would expect data-mangement companies like this to be the shining lights of the future.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:47PM

That deal for Envestra shows how much over the top Australian consumers are paying for energy. Now all of the profits will flow offshore. The local tax take from those profits will probably fall as well.

Stop making stuff up and living in my shadow. Post some trades peanut.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:31PM

HSN hits a 52 week high after i sold out this weekUXC hits a 52 week low after i have been buying in last monthhope its not a pattern that repeats to many times....i might get a reputation/complex.win and lose no one can be all of either for too long/short.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 1:28PM

"The Queensland Competition Authority (QCA) has released its recommended price rises for the next financial year.Typical residential customers would face a price increase of 13.6 per cent."

Must be the carbon tax to blame right? Wait, but there is carbon tax in Europe and prices are stagnant, must Labor fault then right?

Commenter

Viking

Location

Sydney

Date and time

May 30, 2014, 1:28PM

@Viking how much of that price increase is to pay dividends back to gov't, in other words "taxation by stealth". NSW takes over $1billion pa from its State-owned generators as dividends and tax-equivalence payments. When those assets are sold off that income stream is gone for ever, most likely o/seas with tax minimisation methods to reduce local taxes paid.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 3:07PM

Sell offs create opportunity, I have cash ready for the big miners when they change direction. Just a matter of biding your time.

Commenter

Captor

Location

Date and time

May 30, 2014, 1:24PM

@Captor, don't jump in too early. Major sell-offs can take 3 days at least before any serious buying starts. And even then the higher price from buying back in precipitates further selling from those seeking to reduce the size of their loss.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 3:13PM

@DJ77....."Problem is the occupiers are now bellow 50% in Sydney".....

Raises a great point...Get ready for far increasing renters rights. Ouch....That's going to hurt already underwater property speculators when renters lobby government for some cream from the property money machine.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 1:23PM

theres only 23 people reading this thread lets say half of them are reading the comments, half again might agree the other half dont. Now I realise how sad it is that one person on here fights so hard every day to impress possibly 5 people at best with 15 different aliases. ROFLMAO! good luck in your future endevours Allan, Stay away from SBM's cant keep dropping 50% like that, you may as well not invest you would have more money. cheer up, just sayin'

Commenter

Goodbye

Location

my lover!

Date and time

May 30, 2014, 1:21PM

Government receipts have shrunk so they have to hit students, pensioners and the unemployed.

Now the resources companies are moving into full production and 70% of the profit will go overseas.

If they had of stuck with the original mining tax govt receipts would be $30B better off over the next decade. Enough to fix improve indigenous child mortality health and wipe out trachoma.

But no, Gina whipped up a frenzy with "axe the tax" while calling for $2/day wages.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:20PM

Interesting "Government deficits are good for shareholders." article. I'd assume the main reason for this is that governments generally spend AFTER things have gotten bad. So the market has already dropped before government spending kicks in.

Commenter

Peter

Location

Oz

Date and time

May 30, 2014, 12:58PM

The S&P 500 has posted a third record close in four days, despite data that showed the world's biggest economy shrunk over the March quarter, opening the door to a positive start to local trading.

Allan BOOM!

Commenter

GrimReaper

Location

Date and time

May 30, 2014, 12:39PM

US FY is not the same as ours...

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 1:22PM

Australand has now upgraded its operating earnings outlook for the full year 2014. Its earnings per security for 2014 are now expected to increase by 20-25 per cent on 2013. That forecast compares its prior guidance of 17-20 per cent growth announced on 25 March 2014.

Allan BOOM!

Commenter

GrimReaper

Location

Date and time

May 30, 2014, 12:37PM

Did they find a gold-mine under one of their properties.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 1:48PM

Southern Cross Media Group has blamed a 10 per cent profit downgrade on the poor ratings of its metropolitan free-to-air television affiliate Network Ten, as well as soft performance from its 2Day FM metro radio network.

Free to air tv and radio is full of trash.

For $50/year you can stream Pandora and listen to whatever music you want with no ads.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 12:29PM

or listen to double j free. no ads. each state would have its own community radio station too which are usually great. used to be fbi in sydney.Im really enjoying the monday night yank folk session right about dinner time.commercial radio - an australian woman who dresses like a 16yo prostitute school girl "raps" songs written by up to 10 other people ( nothing herself ) including the usual "featuring - insert cliche name " and gets compared to the beatles.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:21PM

I can get all of my entertainment reading your comments for free on the library computer.

Commenter

Tim

Location

Date and time

May 30, 2014, 1:54PM

Can you imagine how far the ASX is going to fall when the Dow has a correction. It can't take the lead from positive O/S markets but bet my you know what it will take the lead when they fall.

Commenter

Gavin

Location

Sydney

Date and time

May 30, 2014, 12:22PM

Well I already have an 8% fall pencilled in for the local market between now and 30th June, based on a consistent 8% fall over that period for each of the last 3 years. Can the market defy history.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 1:41PM

Sorry Mitch. I'm confuzzed, The market has fallen 8% in each of June 2011, June 2012 and June 2013?

Commenter

heybert

Location

Sesame Street

Date and time

May 30, 2014, 2:25PM

No the market has fallen 8% from its highest point in the April to June period by 30th June for each of the last 3 years. On that basis the AllOrds could be around 5075 on 30th June.

Stop making stuff up and living in my shadow. Post some trades peanut.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:16PM

Joe Hockey may find it offensive, and some dinosaurs might cling to the belief that renewable energy can't survive without government subsidies, but "a European utility says wind now cheapest source of energy".

The times they are a changing. There is no economic future for coal. That is the real reason Deutsche Bank refused to fund Abbott Point.

Commenter

Fred

Location

Date and time

May 30, 2014, 12:16PM

Be careful with sources and bias. That site would only have printed the report from that one utility where they may have reasonably reliable winds. May also have forgotten those other words 'government subsidy'.

Similarly and amazingly, the anti-nuclear body tells us that nuclear isn't good. The anti-coal body tells us coal is not good. LNG etc etc

Two words to remember btw - base load.

Commenter

ALittleToTheRight

Location

Date and time

May 30, 2014, 1:16PM

And the advantage with wind, or solar, is that you can use the land for whatever the land was used for before when the towers or panels are eventually removed. With coal you are left with a huge hole in the ground and a destroyed water table and environment. Farmers with wind turbines on their land can still graze their cattle on the same property.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 1:20PM

the answer my friend is blowin' in the wind

the answer is blowin' in the wind

Commenter

Catch 22

Location

Canberra, Australia's windiest city

Date and time

May 30, 2014, 1:43PM

@ALittle base load is why we would keep coal-fired generators. They would supplement supply from renewables as required then go into stand-by until the approach of the next peak period. Instead of being a major polluter from 24hour operation they would become a minor polluter and nowhere near as much coal would be required.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 2:12PM

Base load is more than just a "little". Esp on a still dark night. Oh, and you can't just put a power station into "standby".

Commenter

Titch of ACM

Location

Date and time

May 30, 2014, 3:27PM

@Allan thx for pointing me too that ASIC short summary but its out of date 23/05 [weekly] so i still use the ASX one because its from the previous trading day ...latest info i can find.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 12:11PM

Yes it's the latest but only for one day, not cumulative.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:06PM

11:30am .. abolishing paper money would allow central banks to introduce negative interest rates without fearing that everyone would start hoarding cash.... Also would allow governments to apply a '' Cypress Solution'' as easy as pie. The dash into gold would push up its price as punters dive out of bank accounts. This guy will have the ear governments everywhere.

Commenter

Wally

Location

Flynn

Date and time

May 30, 2014, 12:10PM

negative interest rates. I am so there.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:22PM

"Markets Live: Miners dig hole"

GOLD!

Commenter

no banks .. no party!

Location

Date and time

May 30, 2014, 11:59AM

Does anybody pay any attention to the Reserve's non monetary statements which is totally outside their competence and remit? Don't they know that getting around FIB investment rules is an easy and popular game among foreign investors and criminals for all the family and friends? Do they have any realisation that entire suburbs are being bought up and are driving well off local investors and home buyers into the next ring of suburbs and thereby having a significant domino effect on prices? Do they think we don't realise the Reserve board has possible future conflicts of interest, when they leave and get offered jobs on bank boards?

Commenter

Jim

Location

Date and time

May 30, 2014, 11:56AM

"A Boston Consulting Group report on mining productivity has found that Australia's mines are among the most inefficient and costly in the world, with serious cost-cutting needed to match global competitors."

Must mean another mining boom right?

Commenter

Viking

Location

Sydney

Date and time

May 30, 2014, 11:56AM

what do you mean another?like the first one that would fully fund the NDIS and NBN?which in reality is 100% user pays by big tax increases.still amazed no one saw it coming.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:24PM

Is the Big Switch.. Boomers downsizing going to kill off the housing boom Allan ? you know they say there will not be enough buyers to take their "nothing houses in their nothing suburbs" .. if they really have paid off the mortgage and got a few rentals out there.. why not just hold and live within their means.. to me that would be an altogether different kind of crash..

Commenter

Lean Too

Location

Date and time

May 30, 2014, 11:55AM

Budget cuts to all things save property tax inentives.

Housing Boom!

Commenter

JC

Location

Date and time

May 30, 2014, 11:42AM

Come on bulls. Lift the 200 to 5530 again so I can sell it again. It's like when Mohammed Ali used to rope a dope then punch their lights out.

Commenter

Ridgy

Location

Date and time

May 30, 2014, 11:39AM

30 points is a drop in the ocean and it sure aint going to 3400 lol

Commenter

didge

Location

Date and time

May 30, 2014, 1:19PM

5.9% yield and losing money. Brilliant!

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:34AM

a couple of quotes from Obama and his 2IC Biden yesterday.make of it what you will and how it will effect world markets.First from Obama." The US is the indispensable nation" meaning what - every other nation is dispensable?" Russia, Iran and China are countries that neglect international law"

More interesting from Biden his 2IC addressing the graduating class of air force officer cadets the same day. "We are to lead in shaping a new world order for the twenty-first century in a way consistent with American interest"maybe the TPP will spread to the entire world?? who knows but that seems to be the plan. how and to what end? I guess we will find out in the next few years.

see the ukraine and japan. I love the way the poor down trodden "rebels" manage to find attack helicopters and fully kitted armies magically out of thin air. probably down the back of the couch.good time to be part of the military machineme thinks. seems even we managed to find a few billions for them.sir yes sir. works ffine or me as opposed to being strung up by my thumbs with electrodes attached to my nads.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 2:23PM

Who recommended SBM at 38c? What a silly recommendation! Hope not too many people lost money over that. Disgraceful!!

Commenter

ASX

Location

Historian

Date and time

May 30, 2014, 11:32AM

Nobody recommended it. It's a spec. Not for mums and dads. get over it. Oh and you ignored the previous trades that made 16% and 24%.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:23PM

A community service announcement from your friendly mining magnate:

http://www.youtube.com/watch?v=pMaRuk6pGOc

The biggest resources boom in history and what has changed? Answer: nothing.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:30AM

So if deficits are good for stockmarkets what does that say about future stock market returns when the gov't decides to reduce those deficits. I suppose "contracting our way to prosperity" might sound as good as "stop the boats" but it doesn't make any economic sense. To me it just seems more like an ideologically driven excuse to stick it to the poor. However in doing so, and contracting the economy in the process, the rich are going to feel quite a bit of pain as well. Rather than reducing gov't debt, the deficit will rise as the level of economic activity falls away and tax collections along with it compounded by an increase in benefit payments to all of the newly unemployed. Of course they will be labelled "dole bludgers" and life made as hard for them as possible. That process has already started.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 11:28AM

Carsales or REA?

Commenter

James

Location

Date and time

May 30, 2014, 11:23AM

CRZimo

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 4:47PM

"Chinese steel mills are cutting back on long-term iron ore contracts in favour of cheaper spot cargoes, confident that beaten-down prices are unlikely to rebound amid the first global ore surplus in 10 years."

When there's a surplus with even more supply due to come online how will FMG sell its inferior iron ore?

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:14AM

do you ever let up?

Commenter

craig

Location

Date and time

May 30, 2014, 11:23AM

Remember when BHP/Rio pushed the Chinese mills hard to buy on the spot market not long ago?

Commenter

IRON_Y

Location

Catch 22

Date and time

May 30, 2014, 11:37AM

probably why they are moving into meat. a lot easier and far cheaper to move a sheet load of wild boar / buffalo / camel and farmed beef and sheep out of darwin to asia.we are even exporting to iran again after 40 years.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 11:40AM

They are buying agricultural farms in australia off the chinese, using iron ore for currency!

Commenter

JC

Location

Date and time

May 30, 2014, 11:45AM

Gina's timed her new mine to perfection huh.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 12:12PM

Did you check's FMG's iron ore quality?

Allan Boom!

Commenter

GrimReaper

Location

Date and time

May 30, 2014, 12:34PM

There is a surplus of painfully repetitive comments but people keep trying to sell them too.Housing Boom!

Commenter

Wwwish Lion

Location

Melbourne

Date and time

May 30, 2014, 12:41PM

Liberator said "I have not met a cash flow positive investors who has purchased in the last 5 years... simply does not exist."

Have you met any Nobel winning scientist before ? Yes, they do exist. Hehehe

Commenter

got brain

Location

Sydney

Date and time

May 30, 2014, 11:05AM

No... but a 1 in 7 billion yearly event vs a single investor within the Australian property market... you would think I could have met one at least!!! Given this is my industry! I am sure people who purchased before 2006 may have some cash flow positive happening... maybe?

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 11:47AM

I am cash flow positive and always buying for the right price.land not shares. land I can influence dramatically. shares I cannot - with shares I am at the mercy of vastly over paid delusional people living in an alternative reality. like all those that thought the mining boom we never had would go on for generations and those who say the worlds population will plateau in another 5 years time.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 1:32PM

The peanut gallery said QAN long was a dud. Closed for 28%. I want more duds like that.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:43AM

Didn't follow your QAN. But closed just ARI short for 24% after fee and dividend.

Commenter

got brain

Location

Date and time

May 30, 2014, 10:57AM

Well done. The posted a massive loss and when to 1.87. Pollyannas went bananas. Short closed last week at 1.04 for 29%.

Might be time to go long to cash in on the housing construction boom. More supply, lower prices. But that's ok - losing money in property is making money. Dontchaknow.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:39AM

Yep for a dud it went well. good for you.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 12:14PM

hand off it please, you told me you were short, also wont admit your losses on SBM so how can anyone believe you let alone like you

Commenter

hand off

Location

it

Date and time

May 30, 2014, 12:17PM

LOL yeah so you keep saying with no proof. Hand off it. Yuk.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 1:10PM

@hand off. Allan shorted QAN @ $1.9 and long QAN at $1.04.

Commenter

got brain

Location

Date and time

May 30, 2014, 1:29PM

That $615m property portfolio in DJS is the main prize.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 10:42AM

property is gold.Helene Pastor was assassinated in broad daylight in downtown Nice recently.Her grandfather had the foresight to buy a heap of cheap waterfront land in Monaco in the 50's and build 3000 flats ( now 15% of Monaco's entire housing stock which he never sold. He rented them. Her family is worth $20 billion euros. Similar situation applies to a Lebanese builder in Dulwich Hill who built at least 20 lots of 4 storey high apartments ( parking on the ground no lifts ( 36 apartments per ) back in the 50's and 60's also only ever rented them. Makes for very happy grand kids.

Commenter

smilingjack

Location

Date and time

May 30, 2014, 11:57AM

FMG short now 20% in the money. How low will it go?

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:42AM

I'm not sure it will go much lower. While FMG income is less, costs have also dropped as they (1) borrow at lower rates, and (2) stop the high cost of exploration and mine development.

Commenter

Life Is Good

Location

The Real World

Date and time

May 30, 2014, 12:24PM

Interesting little revelation on the ABC's "The Checkout" last night. The reason Bunnings (Wesfarmers) can advertise that if you can find a cheaper price for a stocked item than the price they charge they will take 10% off their price, is that Bunnings is the only authorised stockist in Australia for a host of brands. So good luck in finding an identical item any cheaper. Another trick is to have an item made that is 99.99% similar to other stockists items but that difference is enough to justify a different model no. and a significantly higher price. Officeworks (Wesfarmers) uses that little marketing strategy.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 10:41AM

Agree, and a lot of other Australian companies are playing these little tricks with their 'valued' customers including Dan Murphy. Always reluctant to lower their prices to meet competition even though it is obvious their prices are not the lowest. However, in the end the customer will vote with their feet and move to better value. It always pays to be honest with your customers.

Commenter

Viking

Location

Sydney

Date and time

May 30, 2014, 11:28AM

@MitchAlso they have to have the stock in store.Had interesting experience a few years ago purchasing Laptop from a major chain. Competitor had lower price but the store told me they only had the demo left. This was a Friday evening. Purchased elsewhere but checked next morning and told they had it in stock. Really got stuck into HO who after investigation apologised and sent me a nice gift voucher

Commenter

Troppo

Location

Melbourne

Date and time

May 30, 2014, 11:55AM

Exactly. I have never heard of anyone getting this fictional 10%

Commenter

gumly

Location

mackay

Date and time

May 30, 2014, 11:57AM

@Mitch. I was able to knock 10% off a box of tiger worms.

Commenter

Wally

Location

Flynn

Date and time

May 30, 2014, 12:14PM

Common Theme Here Today

US talking their economy up.

But statistics point to the opposite.

Watch this space.

Commenter

dunno

Location

Date and time

May 30, 2014, 10:40AM

And in Aust the gov't has been talking the economy down when they were in opposition and now in gov't. Their economic policies revealed so far show that they won't disappoint. Contract our way to prosperity. Well I suppose there's a first for everything.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 12:56PM

The big test today will be when and if we get down to 5500

Commenter

cyril

Location

Date and time

May 30, 2014, 10:39AM

just hit 5500 now so we will soon know!

Commenter

cyril

Location

Date and time

May 30, 2014, 10:58AM

Just rebounded off 5500. New support level?

Commenter

Irish Phil

Location

Date and time

May 30, 2014, 12:03PM

Bounced four times off 5500 today then turned around at 5512 as many. Day traders dream.

Commenter

Ridgy

Location

Date and time

May 30, 2014, 2:22PM

I've been in 50% cash for quite a few weeks. Everyone keeps saying the market keeps moving up etc.

My stocks that I'm holding onto haven't increased that much in the last few weeks. Wouldn't have made much difference if I went to 100% cash. Is it the best of both worlds being 50% cash or am I risking half my capital in a heated market? Who knows? Why do we even pretend to think we know? Too much US Fed funny money to rely on fundamentals.

Commenter

GS

Location

Date and time

May 30, 2014, 10:37AM

hey GS is it time to let the doggies off the chain? thats why tthey aren't going up....i know its hard but the "release the hounds" can be quite theraputic...if they havent gone up by now are they ever...hmmmjust food for thought.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 12:09PM

Article @ 10:31am: I will eat my hat if Solomon Lew does anything to scuttle the planned take over of DJ's. He won't be building a consortium bid, he won't do shareholder activism, I think it is just a ploy by the powers that be to try and drive the SP higher.

Commenter

DR

Location

syd

Date and time

May 30, 2014, 10:35AM

No, The US investors didn't brush off data.The long term investors are on their week long summer holidays....vacation.The gremlins at the office are playing with the trading keyboards pushingup the prices.Checkout the trade volumes if you don't believe me.

Commenter

hammer

Location

Date and time

May 30, 2014, 10:26AM

Hardly an enthusiastic start to trade. Do you think that the market is finally starting to realise that they have pushed prices too high. I for one can't see any reason why the market should be this high given current and forecast economic conditions. Trading volumes are apparently falling away as well, by up to half I'm hearing from brokers. I'm happy to take profits at these high prices and will buy back in as prices fall back towards reality. I don't expect that to take long.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 10:24AM

How can you take profits at these prices when you've been saying that all month? There is only so many times you can sell the same shares. Apparently there is no limit to the amount of times you can keep saying the same thing though.

Commenter

Tim

Location

Date and time

May 30, 2014, 11:04AM

@Tim, that depends on how big a portfolio I started with. Just as well my SMSF is in pension mode o/wise I would have a very large CGT bill. I'm down to about 35% shares at the moment but there are a few June/July dividend payers with very good grossed-up yields that I am buying either for the dividend or the increase in the share price that the looming dividend will cause, or a little bit of both. So 35% could get back up to 65% very quickly.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 11:36AM

How many times do you need to tell us?

Commenter

Peter

Location

Sydney

Date and time

May 30, 2014, 12:24PM

Yes Tim Mitch said a few weeks ago he had sold his shares and would buy back more cheaply. But here he is today still saying he's prepared to sell his shares. Mitch is just hammering this same post every day hoping the market will fall so he can blame abbott. His fantasy trading is nearly as bad as alan's.

Commenter

I agree with Tim

Location

Date and time

May 30, 2014, 1:09PM

@Peter, my ;) SMSF is in pension mode, also in nothing to do repetitive mode. Back in my day we used to walk 5 miles in the snow to get to the stock market and make a trade. one thousand shares for a dollar we'de say...and still have money left over for an ice cream and and a movie at the old picture theatre on the way home. The markets been 30% over valued ever since....

Commenter

Wwwish Lion

Location

Melbourne

Date and time

May 30, 2014, 1:14PM

Portfolio size has nothing to do with it Mitch. I would have thought that somebody sprouting 15 times a day on here that the world is going to end due to the budget and we should be selling all of our shares, would have 0% invested. $10k or $15mill is irrelevant.

Commenter

Tim

Location

Date and time

May 30, 2014, 1:53PM

LOL @Wwwwish. Now just need to repeat that 15 times a day.

Commenter

Tim

Location

Date and time

May 30, 2014, 2:51PM

Does anyone else think what's going on in the US could be one of the greatest confidence tricks the share market has seen?Any news good bad or otherwise has a positive spin, and the market rises.Momentum stocks in the US are at extreme levels, and stocks always beat consensus because they downgrade initial forecasts so that it is impossible to miss.I've listened and tried to understand the bullish views, but every time something in me says warning this is a con.The same protagonists that were complicit in causing the GFC are pumping this market.If things are so great they would stop QE immediately and normalise interest rates, but apparently more QE is on the way in Europe, mmmmmmmm

Commenter

Worried

Location

Date and time

May 30, 2014, 10:24AM

I think the US is biding time hoping for an up-tick in the economic cycle, which they think will allow them to raise taxes somewhat and thus maybe balance the budget. The same sentiment can be heard on this forum. Like, if only this GFC would go away and we'd be booming again...

I'm not sure US "leadership" even understands that their in an existential death-fight and the "GFC" is the new normal. The end game is fast approaching.

Commenter

Dr No

Location

Sydney

Date and time

May 30, 2014, 11:15AM

The biggest con of the 2000s.

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 11:53AM

Reading the interview with NAB's Gray in regards to implementing their 'new' technology platform, one must conclude that NAB is a screaming SELL. To take in excess of ten years for implement technology is too long, just ask Google or Facebook.

Commenter

Viking

Location

Sydney

Date and time

May 30, 2014, 10:21AM

Agree, no wonder Clyne is doing a runner, the writing is on the wall for NAB.

Commenter

Spin Doctor

Location

Sydney

Date and time

May 30, 2014, 10:37AM

That must be why NAB is down the least % of the BIG 4 today (so far). The market has a different view. NAB has more upside potential when it resolves the o/seas issues that have been holding it back.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 11:00AM

@viking, it just shows you have no idea how a bank works or just how big they are. Each of the big 4 would take ten years to do what NAB has/ is doing with Next Gen. Each system in a bank is as complex or more than facebook and there are hundreds of them.

Commenter

Wwwish Lion

Location

Melbourne

Date and time

May 30, 2014, 12:47PM

FMG is considering lobbying the Government to enforce the use it lose it rules and 'muscle' into OIL and Gas. The falling iron ore price is spooking Andrew and he wants to diversify and play with big boys in the big pond OR he hopes to surpass Gina as the richest Aussie. Lost track of whether FMG has started to contribute to Canberra's coffers. Last I am aware by using creative accounting the Company has yet to pay corporate tax.

Commenter

Double HIS Bet?

Location

Date and time

May 30, 2014, 10:13AM

...SALE... SALE... FINAL DAY... Anyone else who wants to "sell in MAY & go AWAY" ?? LAST OPPORTUNITY TODAY...

Commenter

clueless

Location

wonderland

Date and time

May 30, 2014, 10:08AM

" heavy job losses in the coal industry "

Housing boom!

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:07AM

@Allan: why are you so focussed on a housing boom? Are you saying there IS one at the moment, or there will be?

Commenter

Irish Phil

Location

Date and time

May 30, 2014, 10:44AM

Beats me. Newspapers have been running articles along the lines "Is Oz in a Housing Boom?" for the last decade. I'm guessing Alan doesn't realise that constantly re-stating the obvious (that one day there will be a housing price correction) is a pretty meaningless exercise.

Commenter

Peter

Location

Oz

Date and time

May 30, 2014, 11:25AM

Buyer envy.....

Commenter

Wwwish Lion

Location

Melbourne

Date and time

May 30, 2014, 1:15PM

"the US economy shrunk at a worse than expected annualised pace of 1 per cent in the first quarter of 2014"

Housing boom!

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:02AM

I'll give you $50.00 if you don't mention Housing again for 5 days on this site.

Commenter

Mother

Location

Sydney

Date and time

May 30, 2014, 12:27PM

Hey, ill take your money

housing boomhousing boomhousing boom

thats $150 you owe me, now pay up!

Commenter

fortune cookie

Location

Date and time

May 30, 2014, 1:49PM

I think it would be preferred that you donated the $50 to the Henry George "Foundation". Read up and you will understand the incessant posts.

Commenter

By George

Location

Date and time

May 30, 2014, 1:50PM

Make it $5,000 paid to any Aboriginal health related charity and you have a deal.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 2:15PM

"Wages will inevitably fall in rich countries like Australia, the US and UK as the world moves towards economic equilibrium, according to Nobel laureate James Mirrlees."

Housing boom!

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:01AM

Housing boom.....I think there will be as politicians continue trading Australia's future for greed now. They're working out how to do it as we speak (unrestricted RE to foreigners) and a dumb electorate will condone it.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 10:19AM

Was in not under Labor's watch that approval is given for $23B worth of housing stock being sold direct to foreigners - only early this year?

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 11:59AM

@Liberator...Yep..Lib Lab...No difference. Sacrificing Australia's future to keep in power. Arguing about a few dollars here and there to go to the doctor while they destroy everything else. Completely clueless electorate cheer it on.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 1:11PM

remember end of month.Already big volume through before 10am

Commenter

jamie

Location

perth

Date and time

May 30, 2014, 10:00AM

Iron ore price?

Commenter

Realist

Location

Date and time

May 30, 2014, 9:58AM

Dropping like a rock or if you prefer a lump of iron ore.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:21AM

Nah. Just in a cycle. China decides they will do some pink batts or BER next month as expected and the price will skyrocket again.

So simple, though not sure if pink batts will drive too much iron ore consumption, on ten seconds reflection. Maybe provide income for more people to buy metal goods.. yeah, that's it. Makes sense now.

Commenter

ALittleToTheRight

Location

Date and time

May 30, 2014, 11:18AM

@ALittle, just think how much in energy costs those people who had pink batts installed are saving. With a fierce summer to come they are sure to appreciate cooler homes and not having to use the air conditioner so much. Pink batts was a brilliant policy but poorly executed n leaving the way open for the baser part of the Australian character. But I suppose when you are fighting a fire you don't take months to plan your response. By then anything worth saving is gone

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 11:47AM

Australian Wages to fall - It was always going to happen. At some point our economy has to take a few steps backwards. Trades earning more than management, hourly rate shelf packers earning as much as graduate professionals, coffee approaching $6 a cup, a filling taking 20 minutes to finish charged at nearly $200 a pop, 10 minute doctor check up at $60 a hit... list goes on.

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 9:47AM

@Liberator, just think how much that filling & doctor visit will cost when new graduates are looking to pay off their sky high HELP debts at market interest rates. The smartest thing they could do is get their qualifications and basic practice in Aust then flee o/seas. That will leave us with a shortage of health and other professionals that will push fees higher and make access harder. Such an enlightened gov't to introduce such a STUPID policy. Yet another for the Senate to knock out.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 11:43AM

You miss the point entirely mitch. The fact remains current costs have escalated so high under BOTH governments. Maybe 26yr old doctors should give up the new BMW/Audi purchases..

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 1:45PM

"its just a sweet sweet fanatasy baby" love a bit of Mariah Carey in the morning he he. Hey when are we going to get below 5400pts?

Commenter

Mariah

Location

Carey

Date and time

May 30, 2014, 9:45AM

What has 5400 got to do with it? iron ore price is falling. That's all you need to know.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 10:06AM

US ECONOMY SHRUNK!!!!!!

1st they said it was due bad weatherNow they said it was due to falling inventories

But hey it's ok because most economists expect growth to rally for the rest of the year.

Nothing to worry about, the bigger first quarter drag means a bigger bounce back in the 2nd quarter.

What a load of boloney!!!

The US is still stuffed.

Commenter

DUNNO

Location

Date and time

May 30, 2014, 9:42AM

Not only shrunk, but shrunk twice as much as expected! The negative multiplier effect of the US taper is beginning to show - don't blame the weather for the crash to come.

Commenter

Engineer

Location

Scam City

Date and time

May 30, 2014, 10:09AM

Buy housing....

....."Hockey has asked the committee to examine current rules, WHICH LIMIT foreign investment in real estate to new dwellings but allow temporary residents to buy established homes to live in while they are in Australia."....

Restrictions about to be lifted to boost "the wealth effect"? Forget the young, we deserve this.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 9:41AM

Hockey the property speculator with 7 houses is seeking desperately to sell out the country for his own interests. Surprise.

Commenter

Judas Priest

Location

Date and time

May 30, 2014, 12:45PM

When the new party gets in we'll have it all blow up in their faces. We'll take the whole lot and some.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 1:13PM

I am amazed of the number of so-called analysts who continue to convince the public that housing in Australia is not overvalued and that it is more affordable.

Surely most of us are awake to the fact that this aint the case.

Commenter

Why buy a house?

Location

Date and time

May 30, 2014, 9:40AM

@Why buy a house?....Be the best investment you'll ever make...Buy ten...Politicians are committed to it. They own it, there are no other options to keep our sham economy up on their watch.....sheep, farms, resources, companies, assets, now all that's left to sell is realestate to the world's highest bidders....Read what they've done to us over the past 30 years here....http://www.smh.com.au/business/foreign-buyers-claims-mostly-false-rba-says-20140529-397a5.html

Commenter

JohnBB

Location

Date and time

May 30, 2014, 9:55AM

I think you under estimate the simpistic thinking of mums and dads, daughters and sons don't all want to be rich millionaires, analysing every monthly percentage gain. They just want to own their own home, then when they can afford to buy, they buy. No point getting mad because you can see a correction coming, they just don't care. They also don't plan on selling at top of market cycles to make a gazillion dollars. They just want a home. So why be mad at them? They aren't on here getting angry that you in and out of the market every 20secs, I would say that's speculating, and likened to gambling. I would say how come these people lose money just to make some money back to lose it again?

Commenter

Leave

Location

Brittany alone!

Date and time

May 30, 2014, 9:57AM

Yes "Leave Brit.." you got it! Crash or no crash, I'm not selling.

Nobody I know is going to sell AFTER a crash. Why would you? If anything I'll buy more properties and/or upgrade to a bigger/nicer house.

ooooh now you got me excited lol

Commenter

GS

Location

Date and time

May 30, 2014, 10:13AM

"Yes "Leave Brit.." you got it! Crash or no crash, I'm not selling."

I would expect "smart property investors" to have no clue as to what "opportunity cost is", but in the case of any crash that is what you will suffer for not selling at peak.

As for "mum and dad" argument, I agree.. those who view home as place to live do not care about rises and crashes or opportunity cost.

Problem is the occupiers are now bellow 50% in Sydney with "speculators" being more than half.. and on some weekends up to 60%... and those people have been spoonfed lie that property only goes up! In case of any crash when they are looking at prospect of Negative equity their reaction will be.. well have a look at US UK Ireland HK .. yes yes we are different.

PS: GS I am sure many people will be looking to buy after any crash, but those are the ones with Cash who have sold out. For someone like you who did not, property crash reduces your equity and your ability to borrow goes "poof", not to mention in any crash first thing banks do is stop lending. So unless you are sitting on pile of Cash , how exactly are you going to fund these "few more" purchases.?PSS: I do not necessarily believe crash is coming, but I am neither certain it wont. I plan for both, and avoid debt.

Commenter

DJ77

Location

Sydney

Date and time

May 30, 2014, 10:54AM

again who cares, i expect to live another 40 years why do i need equity? i dont want to be a millionaire i dont care about yeilds and percentages. I own 60% of my house and counting, I love where I live, crash, boom or no crash I'm not selling it! Not to invest nothing, what dont you vultures understand! listen to yourselves you sound like financial advisors!

Commenter

Leave

Location

Brittany alone!

Date and time

May 30, 2014, 11:27AM

Actually I am sitting on a pile of cash. This is why I trade and am on here everyday. Money makes money!

I could go out now and buy few more houses but I'm happy with what I've got already and I prefer the liquidity & speed of shares.

There wont be a crash. We are a population of 24M, Melbourne (where I live) is set to DOUBLE in population by 2035. Think about that. NO CRASH.

You speak of opportunity cost, but I feel sorry for all those who have been waiting and saving deposits for their fancy houses instead of just getting into ANYTHING. Opportunity cost is my properties doubling in 9 years and inflation only about 25%. They have also been cash POSITIVE for years now :)

Now let's talk opportunity costs some more ;)

Commenter

GS

Location

Date and time

May 30, 2014, 11:35AM

well said DJ77,

the noose around the neck of most Australians is personal debt. Upsizing or extending debt levels is always a risky proposition, to do so at the moment is remarkably short sighted and ignorant of the global situation.

That noose is set to tighten in the next 12 months...

Commenter

fortune cookie

Location

Date and time

May 30, 2014, 11:47AM

One of the worst things to come out of the last 10 years (mining boom) has been the disproportionate distribution of wealth to the uneducated. When you’ve got a pair of ‘luxury’ European cars with garish accessories parked out the front of a mc-mansion and the farmer wants to shag a millionaire blaring from a 50inch plasma inside, you know we’ve gone a little bit beyond the point of equilibrium.

The LNP should be encouraging tertiary education to help reset the gauge. Instead, they make it less attainable for many.

Commenter

brian

Location

audi is the new bogan

Date and time

May 30, 2014, 9:39AM

Love how all those economists and "experts" try to explain away US contraction. "Bad weather", "inventories", "nothing to worry about" ... just continue printing money out of thin air, everything will be ok.

Meanwhile trust in the US dollar is disappearing, the deficit growing, and it's frankly plain to see from the US budget that when interest rates rise the country will go bankrupt.

Commenter

Dr No

Location

Sydney

Date and time

May 30, 2014, 9:39AM

@Dr. No - any loan you raise from a bank is creating money out of thin air. Why think that 'printing reserves' which never make it out of the banking system, is somehow an issue but not call out all bank lending on the same basis, all of which goes wild until it is paid back and the money is 'destroyed'?

Commenter

Oh_Mighty_Zeus

Location

Mount Olympus

Date and time

May 30, 2014, 10:00AM

US federal budget is some 30% in deficit. The US is borrowing one trillion dollars per year. This wouldn't even be possible unless the dollar was the world's reserve currency. The system is built on trust in the US's ability to pay back. That trust is disappearing. If interest rates rise the US will simply not be able to service her debt. Interests is already one of the biggest tickets in the budget. When that happens the US will default, loss of reserve currency status, radically higher taxes and lower spending, especially on the military. That has implications for US allies in Asia since China is itching to implement hegemony over East Asia and the Western Pacific.

For the first time in Australia's history we won't be allied with the great power that controls our sea lanes. It will be a rude awakening.

Commenter

Dr No

Location

Sydney

Date and time

May 30, 2014, 10:54AM

2013 budget deficit in the U.S. was 4.04% of GDP. The only way that can be a deficit of 30% of the budget is if they only have a gov sector around 12% of GDP...which they don't.

For all the hoopla about U.S. government debt it is majority held by U.S. citizens (~60%), only about 10% is held by China, and is is not at all clear what else folks/ CB's would hold in the absence of U.S. debt. Seriously, what will they hold? yuan? rubles? Euro? Yen? Nonsense.

They can currently borrow all they want at a little over 3% on 30 year terms. 30 years!. I am not saying they don't face issues, but your numbers are not correct and I think your conclusions just don't hold up.

Commenter

Oh_Mighty_Zeus

Location

Mount 'limpus

Date and time

May 30, 2014, 2:03PM

Deficit as percentage of total spending is projected to be some 15% for fiscal year 2015. That's down from closer to 30% just a couple of years ago.

My point though is that even if the deficit is getting smaller, the total debt is growing, albeit at a slower rate.

Their problem is that with rising interest rates servicing that debt will become a lot harder. It is already one of the biggest tickets in the budget. I just can't see them getting through this.

Commenter

Dr No

Location

Sydney

Date and time

May 30, 2014, 2:52PM

Interesting, it appears that the ASX in sheer desperation is trying to follow the US and find another reason to rise. This is hard to fathom as valuations are stretched to say the least. Australian banks are at top valuations vs. peers in the world, and so is TLS, WES, WOW and others. Coal and iron ore prices are falling and will continue to do so, so nothing to celebrate for the miners. How long will this madness continue?

Yesterday you asked after my gold company price comment if I had changed my mind on company talent. Some days I make broad brush comments as I don't want to "hog" the commentary and bore the Sh!t out of everyone like the regular spammers.(I got censored last time for confronting them)

Yes there are definitely some smart operators viz FMG and BDR in the mining companies however very few in the industrials but I usually take those criticisms directly to the board if I hold shares.

Of course small shareholders voting with their feet in Austraila is a farce eg QAN and Westfield.

Commenter

Harry Rogers

Location

Date and time

May 30, 2014, 12:32PM

@Harryjust sometimes i find theres sooo much negativity its hard to "brush" that off,then i see regular sensible posters get caught in the riptide and kinda start losing faith myself. i'm a glass 1/2 full type and feel that the tilting of facts/sentiment driven by daily downbeats doesn't do much to motivate anyone into investing...i'm all for taking punts,after research of course but people constantly lambasting Australia and Australians wears me down too,but hey its all in the mix...good days and bad.happy trading.

Commenter

BearshapedBull

Location

Mugpunters Lounge

Date and time

May 30, 2014, 4:21PM

Palladium has not moved down while gold has continued to fall...It has decoupled from precious metals and will rocket as demand continues to increase and supply decreases.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 9:23AM

Hi All.

Just a follow up on the CGT question from yesterday, is there an allowance for the time the shares were held?

i.e if I buy $1000 and sell them in ten years time at $1100 is the CGT still based on sell-buy/2 (therefore taxed on $50) or is there some allowance given that it was bought ten years ago?

Commenter

libretto

Location

CAnberra

Date and time

May 30, 2014, 9:22AM

Nope. It is either a less than 365 day sale, or a greater than 365 day sale. There is no additional allowance for holding the asset for multiple years.

Commenter

Irish Phil

Location

Date and time

May 30, 2014, 9:39AM

CGT is the same once the sell date is more than a year after the buy date - how much more makes no difference.

Commenter

Dr Kiwi

Location

Date and time

May 30, 2014, 9:44AM

Libretto (and Fred from yesterday), also note that you can only halve the CGT on any asset held more than a year after you have you deducted any other losses from the same FY. So for example, if in the same year you sold something that lost $50, the correct calculation is:

$1100-$1000=$100, then you subtract your $50 loss, leaving $50, then you halve that remaining $50 leaving $25 in profit which then gets taxed at your marginal rate.

The wrong way is: $1100-$1000=$100, then halving the $100 leaving $50, then deducting your $50 loss giving you a total profit of $0.

Obviously the second way is better from a tax perspective, but it's not the correct method and there would be some penalty if the tax dept notices.

Commenter

Gareth

Location

Sydney

Date and time

May 30, 2014, 10:27AM

Nobel laureate....."Australian wages to fall"....An interesting and confirming read....This is going to be interesting....when everyone works out what they've voted for over the past 30 years.

RBA...."Foreign buyers claims mostly false....focused on parts of the market... where there were few first home buyers".....and the lies just continue to the end. Just how, how can the sale of the top tier have no affect on the lower tiers? There are more people competing for fewer properties in the lower tiers..This is disgraceful that the body overseeing Australia's finance could come out with this rubbish.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 9:21AM

@JohnnBB why would cashed-up foreign buyers even be remotely interested in a typical FHB home, ie a poorly-built little box on a tiny block in a new suburb far from the CBD. Foreign buyers want luxury, prestige & access to the action.

Commenter

mitch of ACT

Location

Date and time

May 30, 2014, 9:59AM

@mitch....That's not what I said mitch.

Commenter

JohnBB

Location

Date and time

May 30, 2014, 10:08AM

mitch is correct - from what I have seen only inner city homes / units are trading hand. The 'burbs' are shattered in QLD. I would not buy anything out of the CBD even if I had the cash in my 'spendings' account. For the Northern burbs of Brisbane - I really do pity those FHBs sitting on their negative equity properties.

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 10:29AM

@Mitch & LibForeign buyers are buying properties in some suburbs. Apparently mainly those on 457 visas. Suburb my daughter lives in has a portion which is designated as catchment area for a really good Govt school. Lots of buyers and pushing up prices.My daughter is out of catchment area and prices there are between $50 to $80k lower than the catchment area

Commenter

Troppo

Location

Melbourne

Date and time

May 30, 2014, 11:45AM

Allan's always running aroundTrying to find certaintyHe needs all the world to confirmThat he ain't lonelyGordon counts the blogsKnows he doesn’t tire easily…

Allan thinks the world would be rightIf it could buy shorts from himGordon says he changes his mind more than a womanBut he made his shortsEven when the chance was slim

Allan says he's willing to learn When he decides he's a foolAllan says he'll live anywhereWhen he finally stops shortingGordon combs his hairSays he should be used to itGordon always hedges his shortsHe never knows what to thinkHe says that he still actsLike he is being discoveredScared that he'll be caughtWithout a second thoughtRunning around…

They're going to the trouble of writing songs about you. Congratulations, you're a legend!

It's going to be doubly funny when the property bubble that has been leveraged up on the sky-is-the-limit- China-mining-boom goes into reverse next year. Justice is a coming to a bankster near you..

Commenter

Catch 22

Location

Date and time

May 30, 2014, 10:24AM

Good stuff Prince. *applause. Almost as good as watching the maroon glow grubs get rubbed out in game one! Much respect to the Prince.

Commenter

Here in support

Location

of the Prince

Date and time

May 30, 2014, 10:25AM

to my dismay...the sell off in may

Commenter

goofy

Location

Date and time

May 30, 2014, 10:30AM

5% yield in SEQLD... property investors here can only dream of such numbers. 4% might be about right. I have not met a cash flow positive investors who has purchased in the last 5 years... simply does not exist.

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 10:31AM

But Mum and Dad investors don't care about yields. so yield away 0% or 10% who cares, I still fail to see why your so mad at property, it really gets you hot under the collar.

Commenter

Leave

Location

Brittany alone!

Date and time

May 30, 2014, 10:52AM

@Liberator

thanks Lib. About 65,000 people commuting from Gosford to Newcastle or Sydney daily. Can't buy property for under 300k in Sydney unless you go (very) West. So surprise, surprise Immigration & shortages working in my favour. Lesson to recalcitrant numpties - do some research and reap rewards...5.9%.

Commenter

Prince Eugen

Location

Date and time

May 30, 2014, 11:09AM

Only numpties claim that making a loss is a successful investment.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:27AM

Liber,

could you give us a clue as to what's the situation in those places round about half way between the Brissy and Surfers?

Commenter

Catch 22

Location

Date and time

May 30, 2014, 11:28AM

Catch 22, what property bubble? Allan has been saying for 5 years that property is delivering negative real returns. No logic whatsoever.

Commenter

Tim

Location

Date and time

May 30, 2014, 11:29AM

"I have not met a cash flow positive investors who has purchased in the last 5 years... simply does not exist."

What rewards?

Yeah thanks Lib. LOL.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:29AM

"Mum and Dad investors don't care about yields"

No they lose money betting on a repeat of the capital gains from the last 30 years.

Won't happen. only a numpty thinks losing money is a good investment.

Commenter

Allan

Location

Prahran

Date and time

May 30, 2014, 11:32AM

5.9%... So after expenses what is your negative position? Or are did you buy in 2004?

Commenter

Liberator

Location

SEQLD

Date and time

May 30, 2014, 12:01PM

@Liberator

that's obviously the raw yield. Net yield I'll let you know after EOFY. There's some very good software by a Patrick Shi that you just plug all the data into & it calculates everything for you including some very falutin financial ratios...